What can I ask employees to do when they are on furlough?
When it was originally announced, the Coronavirus Job Retention Scheme (Scheme) was only supposed to last for 3 months. However, since its inception, it has been extended twice and will now run until the end of October 2020.
As the Scheme has gone from being a temporary measure to a long term fixture, employers are becoming increasingly concerned about what they can and cannot ask staff to do whilst they are on furlough as employees are being kept out of the business for much longer than originally anticipated.
Whilst it is clear that employees cannot be asked to do any work that generates revenue for the employer whilst they are furloughed, what is not so clear is what ancillary services employees can be asked to provide that do not generate revenue but are vital to the operation of the business.
As the Scheme has evolved we have had more guidance from HMRC and the Treasury, as well as case law on what furloughed employees are permitted to do:
- Volunteer work but not if it is for the employer or a business linked to the employer.
- If the employee is a director, they can perform their statutory duties on behalf of the company, process PAYE and make a claim to HMRC under the Scheme.
- Training, provided that it does not generate revenue for the employer.
- Participate in grievance and disciplinary proceedings.
- Carry out duties as a trustee or manager of the employer’s occupational pension scheme.
- Act as employee representative for the purposes of collective consultation (whether on behalf of a union or not).
- Give evidence in legal proceedings on behalf of the employer.
What constitutes ‘work’ is left for the employer to decide, but ultimately HMRC will have the final say when it comes to audit those employers who have made a claim under the Scheme. If HMRC decides that an employer has been liberal with its interpretation of ‘providing services’ and/or ‘generating revenue’ (or simply finds that the employer has acted in flagrant breach of the guidance), then it is highly likely that it will seek to recover monies paid out under the Scheme and apply sanctions.